Madison Gas & Electric Co. collected too much from customers in fuel costs in 2012, and is proposing to keep rates steady through the end of next year.

MG&E customers pay the highest rates of the five major investor-owned utilities in Wisconsin. Their rates went up 3.6% in January.

A typical MG&E customer pays $94.39 a month for 600 kilowatt-hours of electricity.

The utility said its costs are rising because of pollution control projects on a coal-fired power plant it co-owns with two other state power companies, but that it would use more than $6 million in savings from last year to offset those higher costs. The utility also asked to push transmission-related cost increases to 2015.

The Madison utility has requested electricity rate hikes every year for 15 straight years, until this year. Over that period, the utility sought annual increases of 7.3% and was granted increases averaging 4.8% by the Public Service Commision, according to the Citizens' Utility Board, a customer group.

Giving customers a break from another increase is the right thing to do given the economy, said Commission Chairman Phil Montgomery, who noted the PSC has approved similar freezes in recent years for customers of We Energies, Wisconsin Power & Light Co. and Wisconsin Public Service Corp.

Commissioner Eric Callisto said the utility gets several benefits from the freeze, including the fact that it keeps its allowed return on equity, or profit, at 10.3%, the same level that was in place since 2012.

"We should also be aware this will lead to, essentially, a baked-in rate increase in 2015 of about $10 million, or about 2.5%," Callisto said. "I do think it's a reasonable tradeoff. "

Utility customer groups, including CUB and the Wisconsin Industrial Energy Group, were generally supportive of the rate-freeze plan, although they had reservations about what the deal could mean for rate hikes in future years.